Stocks Advance as Mideast Fears Ease; Gold Slides: Markets Wrap

LONDON (Capital Markets in Africa) – Stocks rose across Europe and Asia and U.S. equity futures climbed on Thursday, extending a relief rally after America and Iran appeared to step back from a deeper military conflict. The yen and gold declined and oil steadied after a plunge.

The Stoxx Europe 600 Index was on course for a third day rising as every major national benchmark increased. Contracts on the S&P 500 pointed to further gains on Wall Street a day after the underlying gauge advanced when President Donald Trump’s measured remarks on Iran suggested tensions were easing. The major equity benchmarks in Asia all rallied as the region’s bond yields climbed.

European government bonds mostly edged lower after the slump in Treasuries Wednesday. Crude fluctuated after falling to around the same levels as before the U.S. airstrike that killed a top Iranian general.

It’s been a roller coaster start to 2020 for global markets as investors grapple with America’s killing of the Iranian military leader and its aftermath. Wednesday saw risk assets climb again while havens and oil turned lower amid signals from both sides there is no desire for further escalation.

If the relative geopolitical calm holds it will allow traders to switch focus to the next clue on the health of the world’s biggest economy, which will come with the non-farm jobs report on Friday.

“The backdrop remains benign for equities,” Mona Mahajan, an investment strategist at Allianz Global Investors, told Bloomberg TV. “Low rates, low inflation, and low growth. A mild Goldilocks in many ways.”

Allianz Global Investors’ Mona Mahajan says U.S. economic data remains at the forefront in spite of increased tension between the U.S. and Iran.

Source: Bloomberg Business News